On November 29, 2022, the New Jersey Department of Labor and Workforce Development (the “NJDOLWD” or the “Department”) announced what it calls a “comprehensive enforcement strategy” to target employers in specific industries—namely, commercial laundromats and multi-unit residential construction. The purpose of this initiative is straightforward: New Jersey is cracking down on employers in these two industries to ensure they properly pay their workers and provide all benefits afforded to them under the state’s wage and hour laws. According to the NJDOLWD, it chose these two industries specifically because it believes such employers have a history of non-compliance with existing laws, and their employees are often hesitant to seek relief from the Department. 

Some of the laws the Department is focusing on ensure that workers are: 

• paid on the books;
• declared employees, making them eligible for unemployment, workers’ compensation, and temporary disability and family leave insurance, unless their employer can prove the worker meets the requirements for independent contractor status;
• compensated at the state minimum wage rate or more;
• paid for overtime after 40 hours of work; and
• provided paid sick and family leave time. 

The new NJDOLWD initiative is another example of New Jersey’s commitment to seek out and punish employers it considers “wage thieves.” In 2019, New Jersey passed a strict Wage Theft Law that substantially expanded the civil and criminal penalties available for nonpayment of wages and for retaliation, and expanded potential liability for employers, including responsible officers and agents. One specific aspect of the 2019 amendments was to impose liquidated damages of 200% of wage violations, as well as the reasonable costs to collect same. Also in 2019, Governor Phil Murphy signed into law then-Senate Bill No. 2557, which gave the NJDOLWD the authority to issue stop-work orders that could halt an employer’s work at any public or private work site when the state makes an initial determination that the employer has violated wage and hour laws. The initiative, led by the Department’s Wage and Hour and Contract Compliance Division, is likely to be expanded over time to reach other industries and potentially other laws.

In light of the clear mandate set forth by the NJDOLWD, construction and commercial laundromat employers are strongly encouraged to consult with counsel on their wage and hour compliance protocols in order to minimize the risk for a potential Department audit, the assessment of significant penalties and the potential for crippling stop-work orders.